The equity section of Foley Corporation at December 31, 2010, included the following:

5% preference shares, $100 par value, cumulative,

10,000 shares authorized, 8,000 shares issued and outstanding  $ 800,000

Ordinary shares, $10 par value, 250,000 shares authorized,

200,000 shares issued and outstanding $2,000,000

Dividends were not declared on the preference shares in 2010 and are in arrears.

On September 15, 2011, the board of directors of Foley Corporation declared dividends on the preference shares for 2010 and 2011, to shareholders of record on October 1, 2011, payable on October 15, 2011.

On November 1, 2011, the board of directors declared a $.75 per share dividend on the ordinary shares, payable November 30, 2011, to shareholders of record on November 15, 2011.

Instructions:

Prepare the journal entries that should be made by Foley Corporation on the dates indicated below:

September 15, 2011, November 1, 2011

October 1, 2011, November 15, 2011

October 15, 2011, November 30, 2011

Answer rating: 100% (QA)

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